NordenBladet — In 2019, Finland’s economy was in the later stages of a cyclical upturn and demand for labour remained strong, with the number of those employed increasing by 26,000.

However, this change in the level of employment was accompanied by a significantly larger increase in search for labour by employers and the creation of new jobs. In all, employers were looking for more than 764,000 employees. At 65,000, the workforce shortage, i.e. the number of vacancies that remained unfilled, reached a record-high, highlighting the limitations of labour resources. About 333,000 new jobs were created in 2019, which is slightly below the record level of the previous year. The shortage in labour clearly hampered the creation of new jobs. The information is included in an analysis by the Ministry of Economic Affairs and Employment published on 27 January 2021.

In 2019, new vacancies were most often filled by people already employed, followed by students, schoolchildren, and unemployed people. Salespersons, construction workers, healthcare workers and other service workers were the most sought-after employees for the new vacancies. The situation where the vacancy remained unfilled was not as common in new vacancies as it was in other types of recruitment.  The probability that new jobs would be created increased if the employer was a business, if the employer expected the number of employees to grow, if the employer hired a student or schoolchild, if the employer had foreign staff, or if the number of employees varied significantly over time. If the employer used at least three different channels to find employees, the TE Office was the most important channel for filling the vacancy.

The construction, agriculture, forestry and fisheries, and the information and communications sector saw the creation of most new jobs relative to their overall recruitment. On the other hand, the fewest new jobs were created in the healthcare and social services sector, in relative terms. Slightly more new vacancies were created by small employers than large ones.

The main recruitment problems were related to insufficient work experience or education required. Personal characteristics of the applicant and reasons related to the nature of work, workplace or sector also caused problems in recruitment for new vacancies.

The Ministry’s report presents various phenomena related to recruitment based on employers’ interviews and provides an important perspective on the functioning of the labour market. Although the report’s results are based on data preceding the coronavirus epidemic, the results can be used in the development of models for forecasting the need for labour and certain skills, for example. The results also support the development of skills, improving the regional availability of labour and supporting continuous learning. According to the report, SMEs in particular would benefit from more help and advice during the recruitment process, which they find challenging.

The Ministry of Economic Affairs and Employment has analysed the creation of new jobs seven times since 2013. The publication is based on the microdata of employer interviews produced by Statistics Finland for the Ministry of Economic Affairs and Employment and compiled in connection with the study on open vacancies.

NordenBladet — Prime Minister Sanna Marin has congratulated the new Estonian Prime Minister Kaja Kallas, who took office today. Prime Minister Marin sent a letter of congratulations to Prime Minister Kallas immediately after the inauguration and had a video call with her this evening.

The Prime Ministers discussed the bilateral relations between their countries, EU affairs and the health security measures needed to deal with the COVID-19 pandemic in Finland and Estonia. In their discussion, Prime Minister Marin and Prime Minister Kallas highlighted the need for coordinated action to ensure health security in movement across the border.

NordenBladet — High Representative of the EU for Foreign Affairs and Security Policy Josep Borrell has mandated Minister for Foreign Affairs Pekka Haavisto to visit Ethiopia and its neighbouring regions as the EU representative. Minister for Foreign Affairs Haavisto will travel to the Horn of Africa within the next few weeks. During the visit he will discuss the situation in Ethiopia and its neighbouring regions and ways how the international community could provide support in finding peaceful solutions. The topics to be discussed also include the humanitarian situation in the National Regional State of Tigray in Ethiopia. The European External Action Service and Finland will communicate on the matter in more detail as the visit approaches.

Minister Haavisto has been requested to meet different actors and bring messages from the European Union concerning the situation in Ethiopia to the authorities and relevant stakeholders. Minister Haavisto will travel to the region together with Alexander Rondos, the EU Special Representative to the Horn of Africa. Minister Haavisto will report on the visit to the 27 Member States at the Foreign Affairs Council.

“In the past few months we have followed the conflict in the Tigray Region in Ethiopia very closely. Information on the consequences of the armed conflicts has been scarce and we are very much worried especially about the humanitarian situation. At the request of the High Representative, I will travel to the region soon and bring a message to end violence,” Minister for Foreign Affairs Haavisto says.

This is the second time when an EU High Representative has requested Minister for Foreign Affairs to represent the EU. In 2019 Minister Haavisto visited the Horn of Africa with a similar mandate.

NordenBladet — The Ministry for Foreign Affairs is participating in the international programme and will be present among the virtual exhibitors at the Educa goes digital event on 29–30 January. At the event, on Friday, Minister for Development Cooperation and Foreign Trade Ville Skinnari will take part in a panel discussion on the topic of the global learning crisis.

A panel discussion is organised by the Ministry for Foreign Affairs and the Ministry of Educatiorgon and Culture will address the learning crisis in developing countries, which has worsened during the COVID-19 pandemic.This year, owing to COVID-19, the annual educational fair Educa will be held completely virtually. The event is free for visitors, but registration on the Educa goes digital website is required to follow the programmes.

Friday’s programme will be in English and is also aimed at an international audience. The programme showcases the success factors of Finland’s school system and delves into the challenges of teaching during the pandemic and the future prospects of education. The programmes can be viewed as recordings on the event page even after the event.

Panel discussion seeks solutions to the global learning crisis
The panel discussion “Ensuring that learning never stops — reaching those furthest behind”,  organised by the Ministry for Foreign Affairs and the Ministry of Educatiorgon and Culture, is on the event agenda on Friday from 17.15 to 18.15.The panel discussion will address the learning crisis in developing countries, which has worsened during the COVID-19 pandemic. The discussion also asks what Finland can do to ensure that the most vulnerable children have access to school and receive a good education.

The discussion panellists will be Minister Ville Skinnari, Deputy Minister of Education and Human Development Manuel Bazo of Mozambique, CEO Alice Albright of the Global Partnership for Education, and Director of International Cooperation, Strategy and Programme Development Tomi Järvinen of Finn Church Aid. The discussion will be moderated by Professor of Practice Ritva Reinikka at Aalto University.

The Global Partnership for Education (GPE) represented by panellist Alice Albright is the world’s largest exclusively education-focused fund that supports access to school and quality education for children and youth in developing countries. The fund’s operations are based on strengthening partnerships between developing countries, donor partners, multilateral organisations, development banks and the private sector.

Finland returned to be a GPE funder at the end of last year with COVID-19 support, and will continue to work with the fund during the coming five-year period.

Opportunity to chat in the virtual department
The Ministry for Foreign Affairs will have its own virtual booth at the event. In practice, the booth is a website displaying the study materials offered by the Ministry for Foreign Affairs. The site features materials produced by Europe Information specifically for schools, such as the online games ‘EU-peli’ in basic form and ‘EU-peli 2.0’, as well as learning materials for global education. Visitors can chat online with representatives of the Ministry for Foreign Affairs.

At conventional trade fairs, visitors collect printed material such as books, maps and posters. This time, visitors can order products to be sent directly to schools, free of charge, through the Foreign Ministry’s publications services.

When chatting, visitors to the virtual fair can, for example, ask about the Foreign Ministry’s study materials and give feedback about materials and their distribution channels. Hanna PäivärintaThe author is a communications officer at the Department for Communications of the Ministry for Foreign Affairs. Ministry for Foreign Affairs of Finland in Educa goes virtualEduca programme

Source: Valtioneuvosto.fi

NordenBladet — The electrification of society and the solutions offered by the battery industry will have a significant impact on how climate objectives can be achieved. The National Battery Strategy presents the means by which Finland will become a competitive, competent and sustainable player in the international battery industry. The Strategy is founded on the promotion of responsible battery production and electrification.The working group preparing the Strategy submitted its proposal to Minister of Economic Affairs Mika Lintilä on 26 January 2021. The EU aims to create an innovative, competitive and sustainable battery industry in Europe, and the strategy responds to this challenge in part.

Finland can become an internationally important player in battery sectorFinland has many strengths to succeed in the battery sector and electrification. The cornerstones of the Battery Strategy include the availability of raw materials and the capability to process them, expertise in research and production of battery materials and recycling, and competence in electrification and digitalisation. Finland also wants to promote the circular economy of batteries. However, without the production and processing of battery minerals, climate objectives cannot be achieved because recycling alone does not cover the growing need for critical materials.

“Finnish companies have the opportunity to play a significant role in the electrification of European transport and society as a whole. When we utilise our current expertise and develop new competence in the battery and electrification sector, Finland can provide an attractive environment for new investments and the expansion of existing operations,” Lintilä says.

“The electrification of societies and transport is a powerful megatrend. Finland should seize this growth potential, which is only rarely available. In addition to battery raw materials, their processing and circular economy solutions, electrification will also create new opportunities for Finland’s traditional export sectors, including machine, transport and electronics industries. The key to success is competitiveness and a high level of competence,” says Mika Nykänen, Chair of the working group and Director General of the Geological Survey of Finland.

Finland needs to act fast to beat competition in the sectorFinland and other European countries are not considered forerunners in the battery sector, but Finland has a good starting point in the race. Asian countries, in particular China, South Korea and Japan, have a head start in battery technologies.The Strategy’s vision is that in 2025 the Finnish battery cluster will lead the way in producing innovations, sustainable economic growth, wellbeing, skills and jobs in Finland.

The working group proposes the following seven objectives: The battery and electrification cluster will grow and undergo a renewal.  Investments in the battery and electrification cluster will increase.

Operators in the battery and electrification sectors will promote competitiveness in cooperation.The Finnish battery and electrification sector will be known as a successful brand across the world.Responsibility will be a key part of the growth, renewal and brand of the Finnish battery and electrification sector.Finnish operators will play a key role in the new value chains.Digital solutions will expand the knowledge and business base and speed up the development of the battery sector.

More training and funding for battery sector
The working group proposes several measures to achieve these objectives, including the establishment of a new national cooperation body, which would be responsible for bringing together operators in the battery sector and for implementing the strategy. Other measures include improving competence through a training programme for battery engineers, creating a plan for a research programme focusing on the needs of the battery sector, appointing envoys to market Finland as a destination for battery investments and developing public funding.

A large number of experts from companies, research institutions, the Ministry and other public sector organisations have participated in the preparation of the National Battery Strategy.

Source: Valtioneuvosto.fi

NordenBladet — The European Union’s SURE instrument (temporary Support to mitigate Unemployment Risks in an Emergency) offers financial assistance to Member States in the form of EU loans to address sudden increases in public expenditure for the preservation of employment.

The application process for EU SURE loans is under way. Finland has not so far applied for a loan under SURE and does not plan to do so. Finland is itself able to borrow on favourable terms from the markets, making it unattractive to take a SURE loan, because this would include bearing the borrowing costs, fees and expenses incurred by European Commission.SURE is designed to provide temporary financial assistance for EU Member States facing substantial costs in combating the negative economic and social consequences of the COVID-19 pandemic. The financial support is given as loans which the EU grants to Member States on favourable terms.

Source: Valtioneuvosto.fi

NordenBladet — The coronavirus crisis has hit companies in developing countries hard. Finland has increased its guarantees to development finance institution Finnfund, which will strengthen the targeting of its investments to the companies of the poorest countries as well as promote economic and social development.

In addition to adverse health impacts, the coronavirus pandemic has resulted in major economic losses around the world. In developing countries, the private sector accounts for a large share of jobs, and states cannot afford to revive their economies through billion-dollar packages as in the wealthier countries. As a result, restrictive measures, recession and declining trade hit the companies of developing countries particularly hard.

The situation is further aggravated by the fact that poor countries often have poor social security. If there are no safety nets, the collapse of companies and decreasing incomes often mean that people have to face poverty. The World Bank expects the coronavirus crisis to increase extreme poverty for the first time in more than twenty years.

NordenBladet — In its meeting on 25 January, the Government decided to supplement the action plan implementing the hybrid strategy to combat COVID-19. The Government will adopt a resolution on the matter tomorrow.

In line with the decision, the action plan will be supplemented with three new sets of measures aimed at combating the acceleration of the COVID-19 epidemic and, in particular, at curbing the spread of the more infectious virus variant in Finland. The action plan will be supplemented as follows:

Tier 1: All measures for the community transmission phase must be implemented in full in areas where the epidemic is in the community transmission phase. The restrictive measures in force must remain at least at their current level until an assessment can be carried out concerning the spread of the new virus variant and the effectiveness of the measures taken to prevent it.

Tier 2: The recommendations and guidelines for the community transmission phase will be introduced based on the threat of the rapid acceleration of the epidemic or the spread of the new virus variant. The goal is to achieve a strong, rapid reduction in contacts throughout the country. The Ministry of Social Affairs and Health will guide regions in implementing the measures based on a statement from the Finnish Institute for Health and Welfare. The measures will be introduced in the event that the spread of the new virus variant increases in a certain region and to such an extent that immediate action is required.  In tier 2, additional measures may also be introduced at the national or regional level, such as lowering the maximum number of persons permitted at gatherings. The most extensive remote work recommendation and a mask recommendation may also be introduced throughout the country.Other measures under the communicable diseases legislation should be decided on before placing restrictions on children and young people (e.g. suspending group hobbies).

The upper grades of comprehensive school may switch to distance learning. However, this should be a last-resort measure. The Ministry of Education and Culture, the Ministry of Social Affairs and Health and the Finnish Institute for Health and Welfare will specify the criteria for group hobbies that must be suspended in tier 2. At the same time, proactive measures must be taken to support children and young people in order to minimise the harmful effects of the restrictions on their functional capacity and wellbeing. The transition to tier 2 requires separate approval from the Government.

Tier 3: A state of emergency will be declared and restrictions on movement will be introduced in addition to the above-mentioned measures. This is an extreme measure that can be justified only if all of the previous measures have proved insufficient and it can be demonstrated that the epidemic situation poses an immediate threat to the carrying capacity of the healthcare system, or if it is absolutely necessary in order to safeguard the lives or health of the population.

Source: Valtioneuvosto.fi

NordenBladet — In its spring 2021 budget session, the Government will discuss possible plans to expand the tax credit for household expenses. However, a new study shows that the tax credit is not an effective means to increase employment or prevent tax evasion.

Every year, more than EUR 400 million is granted in tax credits for household expenses in Finland. Tax credits for household expenses are generally considered an excellent way to increase employment in the service sector and to discourage tax evasion. However, according to a recent study by the VATT Institute for Economic Research and the Labour Institute for Economic Research, the tax credit for household expenses does not significantly contribute to either of these objectives. Tax credits are also disproportionally granted to people with high incomes.

Tax credit for household expenses has little impact on consumption habits
Using extensive register data, the study examined how changes in the system of tax credits for household expenses affect the demand for services in Finland and Sweden. The study found that introducing or expanding the scope of tax credits did not increase the consumption of services.“According to the study, the tax credit for household expenses seems to benefit mainly those consumers who would have used the services in any case. Because the tax credit does not increase the use of services, it does not generate new jobs in the service sector either,” says VATT Research Professor Jarkko Harju.

Changes in tax credits for household expenses therefore have little impact on consumption habits.“Our research shows that when using services, consumers are not very sensitive to changes in prices. This finding is in line with earlier studies on the effects of reduced VAT rates on the demand for services,” says Research Director Tuomas Kosonen from the Labour Institute for Economic Research.

According to the study, the recipients of tax credits for household expenses earn significantly more on average than other taxpayers. The higher a person’s income taxes, the more they can take advantage of the tax credit, which particularly benefits high-income taxpayers.

Details of tax credit system not well known
The minor impact of changes in the tax credit for household expenses on consumption habits is also partly explained by the fact that consumers are not very familiar with how the tax credit system works. As part of the study, a survey was conducted to determine consumers’ knowledge of the rules related to the tax credit for household expenses.

“Examining taxpayers’ declarations related to the tax credit revealed that many applicants declare a smaller amount on their tax return than they could. There were also surprisingly few respondents who knew the maximum compensation for household expenses or the correct rate of reimbursement,” says Junior Researcher Sami Jysmä from the Labour Institute.

Another idea behind the tax credit system is that if consumers report the purchase of services to the tax authorities, companies will be more likely to report their sales to the tax authorities rather than resorting to the grey economy. “However, the sales reported to the tax authorities by businesses in the cleaning sector did not increase with the introduction of the tax credit. We were surprised to see that the tax credit did not have the effect of reducing tax evasion,” says Researcher Aliisa Koivisto from VATT.  The ‘Impact of the tax credit for household expenses on employment and the grey economy’ study was carried out as part of the implementation of the Government’s 2019 plan for analysis, assessment and research.

Source: Valtioneuvosto.fi

NordenBladet — On 22 January, the Government decided at an extraordinary meeting to tighten border traffic and the recommendations on testing and quarantine.The aim is to prevent the re-escalation of the growth of the COVID-19 epidemic and the spread of the COVID-19 variant in Finland. Should the new virus variant become more widespread, it could result in a potentially much more transmissible epidemic.

Decisions to tighten internal and external border traffic
Border control at internal borders will be continued until 25 February. Entry into the country based on employment will be restricted to essential duties. At internal borders, essential travel constitutes work that is important for the functioning of society or for security of supply. It also extends to certain specifically defined special groups. Entry requires a separate form from the employer. Certain special groups are permitted to enter the country. Such special groups cover those involved in culture, sports and business life, for example. In business life, these include people carrying out tasks necessary to secure the recovery, new growth, regional economy, or long-term operating conditions of a certain sector.Belonging to a border community will no longer be a valid reason for an exemption. The right of the border municipalities’ residents to freely use the services in a neighbouring country will be terminated. Quarantine recommendation will be reintroduced to border crossings.

The definition of relatives will be tightened in relation to decisions concerning internal and external borders. According to the restriction, in future, family members include the following: spouse (including cohabitant and close personal relationship), children, parents, parents-in-law and grandparents. In addition, the Imatra border crossing point will be closed to passenger traffic. Goods traffic will continue as usual. There may be changes to the opening hours of border crossing points at the western and northern borders in Lapland.

For the main part, the decisions will enter into force on 27 January at 00.00.

The reintroduction of internal border control does affect the freedom of movement as laid down in the Constitution, according to which Finnish citizens have the right to enter and leave the country unless their right to free travel has been restricted.